Agri Trends 25 August 2017 Livestock, Fibre, Grains & Oilseeds

Counter weak economic growth!

What can producers do to counter weak economic growth?  First of all, it is important to note on the changing trends in your export markets.  Producers need to gear their enterprises according to global market developments.  China is increasingly following an import led strategy compared to the USA’s focus on export growth. Follow these and adapt your production and marketing strategies accordingly.  Secondly, do not miss out on the latest technological advances.  By adopting the latest proven technologies producers can better outperform their global competitors that enjoy government support.  Thirdly, lower your exposure to credit if it is unnecessarily high.  Lastly, support the strengthening of independent democratic institutions, make clever and wise decisions and do not stop having great business ideas.  The latter is the most important engine to create wealth.

Highlights

Grains & Oilseeds

• Kenyan elections are done, with the same electoral regime remaining in power. The government continues to subsidies white maize, chances are they’ll subsidize white maize till end of September. Currently all supply is imported, mainly from South Africa and Mexico.
• The local sunflower seed and soybean prices followed bullish international prices, after unfavourable weather in the Ukraine, underpinned production.

Livestock & Fibre

• Quality weaner cattle for feedlots are limited, which support prices of better stock. Recently, there was very little weaner stock available for feedlots on some auctions.
• Lower maize prices will support higher weaner cattle prices
• The low cost maize this season prompted producers to hold weaners back in order to do back grounding on cheaper maize making money from the feed margin component.
• High weaner prices encouraged producers to sell their cattle for cash flow purposes.

Potatoes

• South Africa had a very warm winter, no cold damage was incurred and because of that, potato harvest was optimal. Increased volumes are seen in August. Potato prices increased week on week by 13.2% from an average of R2.89/kg last week to R3.24/kg this week. Prices are expected to move sideways for the next 3 months. It is worth noting that from Jan2017- Aug2017, the markets sold 13.5 million 10 kilograms bags more than the same period last year.

For a detailed update please see attachment